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Stock Market Outlook for June 12, 2020


The setups in the equity market appear threatening.

 

Real Time Economic Calendar provided by Investing.com.

 

 

*** Stocks highlighted are for information purposes only and should not be considered as advice to purchase or to sell mentioned securities.   As always, the use of technical and fundamental analysis is encouraged in order to fine tune entry and exit points to average seasonal trends.

Stocks Entering Period of Seasonal Strength Today:

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Apple, Inc. (NASD:AAPL) Seasonal Chart

Apple, Inc. (NASD:AAPL) Seasonal Chart

Harley Davidson Inc (NYSE:HOG) Seasonal Chart

Harley Davidson Inc (NYSE:HOG) Seasonal Chart

Enbridge, Inc. (TSE:ENB.TO) Seasonal Chart

Enbridge, Inc. (TSE:ENB.TO) Seasonal Chart

 

 

The Markets

Stocks dipped on Thursday as an uptick in the number of new cases of coronavirus in the US spooked the equity market.  The S&P 500 Index fell by 5.89%, giving back last week’s gain attributed to the euphoria surrounding the upbeat payroll report.  The benchmark is presently testing levels around the 200-day moving average, hovering around 3000.  Momentum indicators have all clearly rolled over from overbought territory and sell signals with regards to stochastics and MACD have been triggered.  The pattern on the chart looks like an island top reversal where the gap higher on Friday and the gap lower on Thursday has left prices abandoned overhead.  We’ll be watching to see how prices react to levels of support below.  Looking for more technical insight?  Subscribers receive daily reports containing everything relevant to the technical, fundamental, and seasonal status of the market.  Subscribe now.

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Many of the so-called re-opening or epicenter trades that have flourished over the past couple of weeks have come back to their respective breakout points.  The Airline ETF (JETS)has fallen back to its breakout point at $16.  The US Bank ETF (KBE) has fallen back to previous resistance at $31.  And the Oil Exploration and Production ETF (XOP) is back to previous short-term resistance at $56.  These are all critical junctures for the reopening trade, which retail investors had become euphoric in over the past few weeks.  A break below these hurdles could rattle the retail cohort, which have been trading through discount brokerages in a manner that has never been seen before. 

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Sentiment on Thursday, as gauged by the put-call ratio, ended slightly bearish at 1.01.  Following increasing evidence of complacency in recent days, it is no surprise to see a shock session, like we saw on Thursday.

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Seasonal charts of companies reporting earnings today:

Bitauto Holdings Limited Seasonal Chart Party City Holdco Inc. Seasonal Chart

 

 

S&P 500 Index

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TSE Composite

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